To: Cactus Jack who wrote (54459 ) 8/20/2002 5:35:01 PM From: stockman_scott Respond to of 65232 Enron's Kopper Will Plead Guilty and Cooperate, People Say By Anna Marie Stolley and James Rowley Houston, Aug. 20 (Bloomberg) -- Former Enron Corp. executive Michael Kopper agreed to plead guilty to the first criminal charges in the U.S. government's investigation of the energy trader's collapse, people familiar with the case said. Kopper, who managed partnerships for former Enron Chief Financial Officer Andrew Fastow that were used to hide losses, will plead as soon as tomorrow in federal court in Houston, the people said. The Securities and Exchange Commission will file a related civil complaint against Kopper alleging securities fraud, the people said. The cooperation of Kopper in the Enron investigation may put pressure on Fastow to reach an agreement with prosecutors. Fastow created the partnerships that were used to conceal losses and led to Enron's collapse in the second-largest bankruptcy in U.S. history. Kopper made $10.5 million from his holding in one of the partnerships, according to an investigation by a special committee of Enron's board. A guilty plea by Kopper also would ease the political pressure on the Justice Department's Enron task force, criticized for failing to obtain indictments of any Enron executives in its fraud investigation. Prosecutors have brought charges against executives of WorldCom Inc. and Adelphia Communications Corp., accusing them of falsifying financial statements. ``While a Kopper plea may advance the ball a little bit, the Enron team still has considerable distance to cover to satisfy the public pressure to catch big fish in Enron,'' said Jacob Frenkel, a former SEC enforcement lawyer. ``He should, however, be in a position to shed light on Fastow's role in the partnerships.'' Bryan Sierra, a Justice Department spokesman, declined to comment on the matter. Wallace L. Timmeny, Kopper's lawyer, also declined to comment, as did Gordon Andrew, a spokesman for Fastow. Bank Charges In June, prosecutors detailed evidence against Kopper and Fastow in criminal charges filed against three former employees of National Westminster Bank Plc of the U.K. The three were accused of skimming $7.3 million from one of the partnerships created by the Enron executives. The criminal complaint and affidavit provided details on how Kopper negotiated with the bankers to help them buy a share of the Southampton Place LLC partnership from National Westminster Bank. The complaint alleges that Kopper and Fastow helped the three former bankers dupe National Westminster into selling them the bank's share of the partnership before a hedging transaction was liquidated. The complaint details a series of meetings Kopper had with the defendants and e-mails they exchanged. The investigation by a committee of Enron's board found that Kopper reaped $10.5 million from his $125,000 investment in the Chewco partnership. Kopper also received $2 million in management fees from Chewco, the report said. The investigation could not learn how the payments were determined ``or what, if anything, Kopper did to justify the payments.'' The report faulted Kopper for not disclosing to Enron's board that he had a financial interest in the partnerships. Kopper was required to get a waiver of the company's ethics code to become an investor in the partnerships, the report said.